OTC to ease listing terms to attract small-scale firms<\/p>\n
JAKARTA (JP): PT Bursa Paralel Indonesia, the country's over-
\nthe-counter stock market, will ease its listing requirements to
\nattract small-scale companies, says the market's new president,
\nTito Sulistio.<\/p>\n
Tito told a three-day international conference on capital
\nmarket activities here yesterday that small- and medium-scale
\ncompanies will be the main targets in the future.<\/p>\n
\"There are thousands of small- and medium-scale companies
\nhungry for investment funds here. That's why I am very
\noptimistic,\" he said<\/p>\n
Tito, the former chairman of the Jakarta Brokers Club and a
\nmember of the supervisory board of the Jakarta Stock Exchange,
\nsaid that the OTC market also is aimed at companies already
\nlisted on both the Jakarta and Surabaya stock exchanges.<\/p>\n
\"The operation of the OTC is different from the other two
\nstock markets and I believe share trading on the OTC will be more
\nattractive,\" said Tito, who quit the club and the JSX in addition
\nto leaving his job as the president of PT Pentasena Securities
\nbefore assuming his new position.<\/p>\n
The OTC market was established in 1987 but its trading
\nactivities remain dormant. The number of listed companies totals
\nonly 18 at present, comprising 13 bond issuers and five share
\nissuers. Its trading volume is also very small, totaling only
\n4.17 million shares worth Rp 10.2 billion (US$4.85 million) in
\nall of 1993, as compared to 3.84 billion shares worth Rp 19.03
\ntrillion on the Jakarta Stock Exchange (JSX) in the same period.<\/p>\n
Preparations<\/p>\n
Tito said that a number of measures are now being prepared to
\nrevitalize the market's operation, such as upgrading trading
\nfacilities and personnel.<\/p>\n
Panelists at the conference, sponsored by the JSX and the
\nPACAP Research Center of the University of Rhode Island, however,
\nwere pessimistic over the future of the OTC market, given its
\ninadequate trading facilities.<\/p>\n
Khairil A. Abdullah, of the Securities Commission of Malaysia,
\nsaid that competition with the country's two exchanges is
\nunavoidable.<\/p>\n
\"The OTC will likely face difficulties in competing with the
\ntwo markets, which are relatively stronger in the fields of both
\ntrading facilities and manpower,\" he told the meeting, which
\nended yesterday.<\/p>\n
David Linnan and Cordon G. Dash, of the University of Rhode
\nIsland, were of the same opinion that the trading networks should
\nfirst be improved to make the OTC attractive for both investors
\nand share issuers.<\/p>\n
Participants were also pessimistic that Tito would be able to
\nturn his dream into a reality if no major breakthrough occurred
\nin both trading facilities and the legal framework.<\/p>\n
They agreed that the OTC will bring much help to small- and
\nmedium-scale companies, but that their lack of business
\nprofessionalism and the high expenses to be made during public
\nofferings could hamper them from floating their shares on the
\nmarket.<\/p>\n
Companies should, at the very least, hire professional
\naccountants, legal consultants and a number of other supporting
\nagencies to help them \"go public.\" Each company will also be
\nrequired to publish a prospectus for the public.<\/p>\n
\"Small and medium companies cannot afford to meet such
\nrequirements if no special treatment is given to them,\" an
\nexecutive of a foreign securities firm said. (hen)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/otc-to-ease-listing-terms-to-attract-small-scale-firms-1447893297",
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